Industry · Lead story
Washington now owns a piece of the only rare earth mine in America
A $400 million Pentagon stake, a $110-a-kilogram price floor and a tenfold magnet target turned a California pit into industrial policy.
The federal government is now a shareholder in the country's only operating rare earth mine. Under an agreement struck in July 2025, the Department of Defense put $400 million of preferred equity into MP Materials and took a 15 percent ownership stake in the company, which mines and processes ore at Mountain Pass, 53 miles southwest of Las Vegas.
The money comes with two conditions that matter more than the equity. The first is a ten-year floor price of $110 per kilogram on neodymium-praseodymium oxide, roughly double the Chinese market level and more than twice the $52 per kilogram MP averaged in the second quarter of 2025; Washington makes up the difference if prices fall below the floor. The second is a mandate to scale magnet production tenfold, to 10,000 metric tons a year, at a plant scheduled to start up in 2028.
MP is contributing $600 million of its own capital, and the Pentagon is lending another $150 million for heavy rare earth separation at Mountain Pass — the step that separates dysprosium and terbium from everything else, and the step almost nobody outside China performs at commercial scale. Investors read the terms as a guarantee rather than a bet: the company's shares rose nearly 50 percent the day the deal was announced.
"A price floor is the part of this that competitors cannot copy," said one supply chain analyst who tracks the sector. "A subsidy builds a plant. A floor tells a lender the plant has revenue in year seven."
For mine operators the practical read is a hiring and training problem. A mine that ran with a skeleton crew through the 2010s is now staffing up through 2028, and every one of those jobs lands under 30 CFR Part 48 because a rare earth operation is a metal/nonmetal mine. New surface miners need 24 hours of training before they work, and eight hours of refresher every year after that.
The caveat is the calendar. The magnet plant is a 2028 project, heavy separation is still measured in hundreds of tons rather than thousands, and China produced an estimated 270,000 tonnes of rare earth oxides in 2024 against roughly 60,000 tonnes from the rest of the world combined. One pit in the Mojave does not close that gap by itself.